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TMCNet:  83K Defense workers with security clearance owe millions in back taxes [Dayton Daily News, Ohio :: ]

[July 30, 2014]

83K Defense workers with security clearance owe millions in back taxes [Dayton Daily News, Ohio :: ]

(Dayton Daily News (OH) Via Acquire Media NewsEdge) July 31--Federal auditors say 83,000 Department of Defense employees and contractors with security clearances owed more than $730 million in federal taxes in June 2012.

The Government Accountability Office report found 31 percent, or 26,000 of those workers have access to classified information and owed a total of $229 million. The others cited in the report were eligible for access to classified data on a need-to-know basis. The debts ranged from $100 to million of dollars, GAO said.

GAO auditors noted federal laws don't prohibit someone with unpaid federal taxes from holding a security clearance, "but delinquent tax debt poses a potential vulnerability." History shows the risk of a security breach from someone facing financial pressure is real, said Dennis DeMolet, the National Military Intelligence Association Midwest director on the organization's national board of directors.

"The unequivocal answer is, yes, it can be a threat because they can manipulate those records, they can change those records, depending on what their level of access is," he said.

Employees with unpaid federal tax debt should have their security clearances suspended until the issue is resolved, said DeMolet, a Kettering resident and former Wright-Patterson Air Force Base employee.

"They should be put on total suspension, not fired, until such time they clean up their act with the federal government and, if they were reinstated, put under scrutiny," he said.

The federal government has not reacted fast enough to screen employees with access to classified information, he said.

GAO noted the Office of the Director of National Intelligence estimated 5.1 million military, civilian and contractor employees had a security clearance in October 2013. The Department of Defense does not maintain a database that shows how many were denied security clearances because of unpaid taxes, the GAO said.

Wright-Patterson also does not track how many employees and contractors owe back taxes, a base spokeswoman said.

The Defense Department re-investigates the background of individuals who hold top secret clearances every five years, and those who hold a lower level "secret" clearance every five years.

"If during any background investigation something was brought to our attention, we would look at each individual on a case-by-case basis," Wright-Patterson spokeswoman Marie Vanover said in an email.

Employees must abide by Air Force regulations on paying off debt obligations, especially taxes, or they could face administrative discipline, guidelines show.

At the National Air and Space Intelligence Center, the agency does not maintain records of an employee's delinquent taxes unless it's self-reported, according to NASIC spokesman Master Sgt. Brendan Kavanaugh.

When the information is reported, or included as part of a background investigation, the information is sent to the Defense Department Central Adjudication Facility for a decision on the status of a security clearance, according to NASIC.

In other data, the GAO report found: About 40 percent, or 34,000 of those who owe delinquent taxes, have a repayment plan set up with the Internal Revenue Service.

Just over half of those with tax debt, or 44,500 people, were federal employees.

About 25 percent of the individuals with tax debts were eligible for top secret clearances.

The GAO report excluded intelligence employees and those in the federal executive and legislative branches, which were not in the Defense Department database examined.

___ (c)2014 the Dayton Daily News (Dayton, Ohio) Visit the Dayton Daily News (Dayton, Ohio) at Distributed by MCT Information Services

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